IS IT TRUE March 22, 2013

11

The Mole #??
The Mole #??

IS IT TRUE the estimated mortgage on the new hotel will be approximately $37 million dollars?…at a 5% interest rate over 15 years the monthly mortgage will be $277,000 per month or $3,324,000 per year?…if one divides the debt service by the number of rooms that have been proposed [$3,324,000 by 250 rooms = $13,296], this is the annual debt service per room then divide this by 365 day = $36.43 per room per day?…the average capacity rate of hotels being monitored in Evansville is now 58% so one can divide the $36.43 by 58% = $62.81 per stay?..the other local innkeepers and particularly Aztar will challenge this hotel with a room rate of $99 per night?…this $36.19 (99-62.81) per one night stay will be left to handle all of the other costs including labor, maintenance, utilities, taxes, and of course unforeseen expenses?…the CCO wonders just how in the world can this venture achieve positive cash flow at this rate?…the unfortunate truth is that for a downtown Convention Hotel to work financially the taxpayers of Evansville will have to be treated like Mayor Winnecke’s ATM machine to subsidize an unsound venture?…the Mayor may have the ATM card of the City of Evansville in his pocket but the City Council has the PIN Code?…this means that if $37 Million is to be squandered on a venture that has no chance of unsubsidized success that it will be a joint effort by the Mayor’s Office and the City Council that sacrifices yet another significant pile of taxpayer dollars on the altar of downtown Evansville which has already consumed nearly about half a billion dollars without real sustainable progress?

IS IT TRUE while typing this column the CCO received notification that the CVS on Covert Avenue just north of Weinbach was robbed at gunpoint in broad daylight?…the police reports have recently started creeping up and instances of violent style crime seem to be on the increase?…some people will rob you with a gun and be prosecuted for a crime while eventually landing in prison for their dirty deeds while others will rob you with a pen and contracts by committing YOUR MONEY on their pet projects?…cronyism and self indulgence using public money is unfortunately not a crime that can be prosecuted but it should be?…of just a few politicians (outside of Illinois) were sent up the river to work on the rockpile a whole lot less of the overpayment, sweetheart deals, and irrational spending would be happening?…trading a nice suit and tie accompanied by imported leather shoes for an orange jumpsuit is not a choice that most pampered politicians would ever make?

IS IT TRUE in some areas of the country the market for new homes seems to be reverting back to the go-go days of the 1990’s?…there are reports from California of housing tracts selling out in advance and existing homes being bid up by multiple offers to prices of up to $50,000 above asking price?…in the case of one tract in Palm Desert called University Pointe every home was reserved the first day the renderings were released and the prices changed by the minute?…the last home which was reserved late in the day sold for $72,000 more than the first one that was reserved at 10 am the same morning?…it was the very same home on a different but equivalent lot?…whoever reserved that house at 10 am seems to have done very well for themselves?…real estate seems to be coming back strong in all but a few locations where people just do not want to live?…this is not as much an artifact of the economy as it is about the rock bottom interest rates and the fact that much of the demand is being driven by buyers who did short sales more than 2 years ago that are now eligible to get a mortgage again?

IS IT TRUE that the CCO wishes to congratulate the Harvard Crimson on their first ever NCAA tournament win?…many people had Coach Steve Alford’s New Mexico Lobos going to the Final Four and the smart guys from Harvard busted that bubble?…we wish good luck to the Indiana Hoosiers today as they start their quest for a 6th NCAA championship?

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11 COMMENTS

  1. I wish real estate prices here would jump up like that. Too bad we are starting to become little Detroit.

  2. I had one of the Blue Notes calculate this:

    Monthly Payment: $ 292,593
    Annual Payment: $ 3,511,116

    180 Payments (15 Years) Amortized:

    interest $ 15,666,856
    Principal 36,999,999

    Total Payments $ 52,666,855

    Even here in Philly, that’s a lot of scratch

    • Word is that Winneke et Al are taking a hard look at the Cyprus solution. They are currently gathering information on bank savings and investment accounts in order to see how much is available for looting.

      Before you start laughing, if they go through with this hotel deal, isn’t that EXACTLY what they will be doing. The money will have to come from somewhere and you and I would get thrown in jail if we tried the quantitative easing route.

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  3. I appreciate you math regarding the (possible) new hotel, but one reason for building one is the hope that The Centre and The Ford Center will attract MORE visitors to Evansville. That would increase the 58% occupancy.

    If that is not an expectation, why bother.

    But the lack of a replacement for the Executive Inn is just one of the failings in the planning for The Ford Center.

    The planning in Owensboro compared to Evansville is one huge reason they appear to be a more progressive small city.

  4. One day Owensboro will surpass Evansville in size if Evansville doesn’t get better leadership. Owensboro has their act together and is kicking our butt daily.

  5. The only people who it appears really benefit from a downtown hotel are the bank or banks holding the mortgage. A virtually taxpayer guaranteed loan with a $3.3 million annual service. Sounds like a banker’s dream to me.

    Whichever bank gets the mortgage, he will see his lending reserves increase by 10x the $37 million, or $370 million.

    What was this Mayor’s former job again?

  6. Pillaging is the joy and pastime of Evansville´s “Leadership”. Their smugness about it exceeds the definition of contempt toward their fellow man, and decency in how they live their Lives. I view them as Scum of the Earth.

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